Economic Update for the Week Ending November 27th, 2021

Stock markets drop on new coronavirus variant fears โ€“ย Stock markets dropped sharply on Friday after it was reported that a new variant of the coronavirus was discovered in South Africa. Many countries immediately instituted new travel restrictions in order to limit the spread. Bond yields dropped as investors rushed to safety which drove mortgage interest rates down.ย The Dow Jones Industrial Averageย closed the week at 34,899.34, down 2.0%ย fromย 35,601.98 last week. It is up 14.2%ย year-to-date. ย The S&P 500 closed the week at 4,594.62, down 2.2%ย from 4,697.96 last week. It is up 22.7% year-to-date.ย The NASDAQย closed the week atย 15,491.66, down 3.5%ย from 16,057.44 last week. It is up 20.3% year-to-date.

Dropping Stock Market graph

U.S. Treasury bond yieldsย –ย The 10-year treasury bond closed the week yielding 1.48% downย fromย 1.54% last week.ย The 30-year treasury bond yield ended the week at 1.83%, downย from 1.91% last week. We watch bond yields because mortgage rates often follow treasury bond yields.ย 

Mortgage ratesย – The November 24, 2021,ย Freddie Mac Primary Mortgage Surveyย reported mortgage rates for the most popular loan products as follows:ย The 30-year fixed mortgage rate was 3.10%, unchangedย fromย 3.10% last week.ย The 15-year fixed was 2.42% up fromย 2.39% last week.ย The 5-year ARM was 2.47%, almost unchangedย from 2.49% last week. Stock markets dropped on Friday and interest rates dropped after news broke of a new strain of the Coronavirus. The 30-year was back to 3% on Friday.

U.S. Existing-home sales increase slightly in October โ€“ The National Association of Realtorsย reported that existing-home salesย increased 0.8% in Octoberย from the number of sales in September. Year-over-year sales were down 5.8% from their near-record number one year ago. Theย median priceย paid for a home in the United States wasย $353,900, upย 13.1%ย from $313,000 last October. There was aย 2.4-month supplyย of homes available for sale, down from a 2.5 month supply last October.ย First time buyersย accounted forย 28%ย of all sales.ย Investorsย andย second-homeย buyers accounted forย 17%ย of the sales.ย 24%ย of the sales wereย all-cashย purchases.ย Foreclosuresย andย short-salesย accounted toย less than 1%ย of the sales. Existing-home sales include single-family, condominium, townhouse, and co-ops.

Sources:

  1. ย Rodeo Realty, Inc.
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